Palestinian media ( citing an unknown Fatah leader) today reported that PA president Mahmoud Abbas refused a one billion $ deal to solve the PA’s financial crisis in exchange for not suing Israel at the International Criminal Court (ICC).

In a related development the European Union yesterday decided to approve the first installment of 100 million euro’s aid to the PA and UNWRA.

Below are the press release about the EU aid and the original message about Abbas’ billion dollar deal refusal from Al Quds media.

Arab Israeli journalist Khaled Abu Toameh revealed last week that the PA cancelled outstanding electricity debts for Palestinians in the West Bank. He also wrote that despite the ongoing financial crisis in the PA, Fatah and PA officials received unprecedented privileges like dental treatment in Tel Aviv and shopping sprees in Israeli owned businesses.

Earlier Quds Net published an article about a new report by MAS, the Palestinian Palestinian Economic Policy Research Institute, in which the PA was critized for spending 31% of the Palestinian Gross Domestic Product on the security services.

According to MAS researcher Ahmad Qabajeh, the security services take up a much bigger of a chunk of the budget than needed, saying that the number of employees working in the security sector exceeds those working in the education, health and social affairs sectors together.

In his report, Qabajeh calls for a decrease in security expenses and a reassessment of the need of the Palestinian society for this amount of security apparatuses and personnel.

Qabajeh said there were 64,687 security employees out of the 153,000 government employees, adding that 31% was a very high percentage. Qabajeh’s breakdown of the budget according to his study is as follows: 11% for the health sector; 19.4% for the education sector; 43% for social services.

The PA’s net revenues for 2011 totaled NIS8.5 billion. He also said, according to data from the finance ministry that the overall expenditures for the security and public order sector for 2011 reached NIS3.088 billion as of October of that year with NIS2.373 billion spent on salaries alone. (http://qudsnet.com/arabic/news.php?maa=View&id=235227)

Original article and press release about Abbas and the EU aid:

AL MAYADEEN CHANNEL: ABBAS REFUSED A $1 BILLION DEAL TO SOLVE THE PA’S FINANCIAL CRISIS IN EXCHANGE FOR NOT GOING TO THE ICC

A senior Palestinian leader in Fatah said international parties offered President Abbas a deal that would solve the PA’s financial crisis by transferring $1 billion to the presidential treasury in exchange for a promise from Abbas not to go to the International Criminal court to try Israel’s leaders for war crimes.

The leader, who made his statements to the Mayadeen Satellite Channel said the same pressures that were applied to late President Yasser Arafat were being applied to Abu Mazen, both of whom did not break them or the people.

At present, the PA is suffering a deficit that exceeds $1 billion in its general budget. The government has said it does not know when December’s half salary will be paid either, adding that it needs $150 million each month to pay its employee salaries. (Al Quds)

PRESS RELEASE:THE EU APPROVES 100 MILLION EUROS IN SUPPORT FOR THE PA

The European Union approved yesterday the first installment of aid to the Palestinian people for 2013 for 100 million euros, to the PA and UNRWA, both providers of vital services to the people.

Brussels, 15 January 2013

New European Union assistance for the Palestinian people

The European Union has decided to bring forward the first part of its 2013 assistance package for the Palestinian people to the beginning of the year in order to ensure that the support to the Palestinian Authority (PA) and United Nations Relief and Works Agency for Palestine Refugees in the Near East (UNWRA), who provide vital services to the Palestinian people, is not interrupted.

The Decision has two components. For the first, €60 million will be allocated to the PEGASE mechanism, which supports the Palestinian National Development Plan by helping the PA to finance its budget deficit and implement its reform agenda, meet its obligations towards civil employees, pensioners and most vulnerable citizens, and maintain the functioning of the administration and the provision of essential public services to the population. This amount will contribute to the Palestinian Authority’s payments of salaries and pensions for the first three months of 2013.

The Second component allocates an initial amount of €40 million to UNWRA’s 2013 regular budget (General Fund) in order to support the education, health, relief and social services programmes which UNWRA is responsible for providing for Palestine refugees in West Bank, Gaza, Jordan, Syria and Lebanon.

High Representative/Vice/President Catherine Ashton said: “The European Union is again doing its utmost to underpin the ability of the PA and UNRWA to deliver essential services to the Palestinian people without interruption. We are committed to continuing our support while urging other donors to follow suit. This year we are also earmarking a specific allocation for the Jerash refugee camp in Jordan, which is home to some of the most vulnerable Palestinian refugees in the Middle East.”

EU Commissioner for Enlargement and European Neighbourhood Policy Štefan Füle, announcing the adoption of the package, said: “The Palestinian Authority has particular problems in obtaining donor funds early in the year. The EU is aware of this and, as a reliable donor, has taken steps to alleviate the problem. These funds for both the PA and UNWRA for early 2013 are vital for ensuring that there is no interruption in the provision of the basic health and education services which the Palestinian people need”.

In addition to the two components financed from the 2013 budget, a further amount of €2 million is allocated from 2012 funds to rebuild shelters for around 100 of the poorest Palestinian refugee families in Jordan’s Jerash Refugee Camp.